The oversight body for an African port is being told to relax tax rules in order to gain clients.

The Tanzania Port Authority is being urged to ease taxation regulations in order to boost cargo use at the Dar es Salaam port. The Parliamentary Infrastructure Development Committee has said a bad tax regime at the port has led customers to look beyond Dar es Salaam for their importing and exporting needs.

Norman Sigalla, chairman of the parliamentary panel, contends that use of Dar es Salaam has not grown as much as it could have because of a value added tax driving importers and exporters to consider neighboring states, such as Kenya, Mozambica and South Africa.

“VAT is a key factor scaring away port users as it inflates the costs of clearing the cargo,” Sigalla told the AllAfrica news organization.

He said there is no denying that the slower growth at Dar es Salaam is linked to unfriendly tax policies.

The Infrastructure Development Committee also said the Tanzanian government needs to eliminate double taxation for cargo storage. Panel members said both the Tanzania Port Authority and the Tanzania Revenue Authority require storage charges for the same cargo held in the same warehouse.

According to the panel, port authorities also need to extend the maximum time that cargo may stay free of charge from 30 days to 90 days. That would put Tanzania in line with rival ports, the panel members said.

The parliamentary panel noted that Malawi, Zambia, Burundi, Rwanda, Uganda and the Democratic Republic of the Congo all rely on the Dar port for their imports and exports.

Tanzania is hoping for 18 million tons of imports passing through the port next year, but fears are surfacing that that number may not be reached because of some traditional customers turning to other options. Dar es Salaam handled 14.7 million tons of cargo in fiscal year 2014-15.

Port acting manager Hebel Mhanga noted that the facility has lost some customers to the Congo and Zambia because of an expedited travel time to and from Beira. Those other ports can get items to and from Beira in four days. It takes more than a week for the same goods to get to and from Beria from Tanzania.

He said the port handled 5.1 tons of cargo destined for neighboring states last year.

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